Inflation is finally coming down, but Federal Reserve Chair Jerome Powell warned that the U.S. economy is not out of the woods yet.
In a question-and-answer session at the Economic Club of Washington, DC, the nation's top banker said that he expects the process to take some time.
“The disinflationary process, the process of getting inflation down, has begun and it’s begun in the goods sector, which is about a quarter of our economy,” he said. “But it has a long way to go. These are the very early stages.”
The comments track with Powell's previous statements that goods inflation is only part of the run-up in prices, and that services are now one of the biggest drivers of inflation.
Despite Powell sticking to his guns that inflation could be here for a while, stocks got a bump on Tuesday following the comments. Many investors appear to be holding out hope that the Fed will soon pull back on rate hikes, which would give equity markets some room to breathe.
Powell, for his part, stressed that it will likely take another full year for inflation to be brought under control. “We expect 2023 to be a year of significant declines in inflation. It’s actually our job to make sure that that’s the case,” he said.
Still, the Fed has already started moderating its stance. Earlier this month, the Fed announced a 25-basis-point hike, down from 50 basis points enacted at its previous meeting.
Amanda Chu of POLITICO reveals how lawmakers are betting millions on pharma stocks even as Trump threatens tariffs and demands steep drug price cuts. Watch!
Hayley Berg, Hopper’s lead economist, previews soaring summer 2025 travel: record international flights, cheaper fares for Europe & Asia, plus booking hacks.
NerdWallet Senior Economist Liz Renter shares what she's tracking in economic data, with a focus on U.S. household debt and rising credit card balances. Watch!
At some 940-pages, the legislation is a sprawling collection of tax breaks, spending cuts and other Republican priorities, including new money for national defense and deportations.
Chris Versace, CIO at Tematica Research, joins to discuss earnings season trends, Flash PMI signals, Walmart’s strategy updates, and Nike’s evolving outlook.
Andrew Nusca, Editorial Director at Fortune, dives into WhatsApp’s first-ever ads rollout —and how Meta’s ad push intensifies its showdown with OpenAI.
